Personal Accountability in Health Care
I strongly agree with Marcy Morrison, the Colorado Insurance Commissioner, on her recent statements regarding personal accountability for health:
“If people take better care of themselves, we can look at other options besides how to get more care. We read a lot about diet and exercise, but we have to ignite the public to put two and two together. Disease management and prevention are the key, and as state insurance commissioner, I’m pushing that issue hard to bring down costs.”
Public policy needs to address the fact that 770,000 Coloradoans are uninsured, but we also need to start holding people more accountable for their own health. The individual health insurance market already does this, but the majority of Colorado insureds get their coverage through an employer, where there is virtually no incentive to work at staying healthy. The policies are guaranteed issue, and pre-existing conditions are covered. Some employers offer discounts on insurance premiums for employees who are actively taking care of themselves. A similar program could be instituted by the state, allowing a tax credit for residents who keep their weight in check, don’t smoke, and maintain health blood sugar levels, cholesterol, and blood pressure. This type of program could apply to all Coloradoans, regardless of where they get their health insurance.
There should also be consequences within the insurance industry for those who take no responsibility for their own health. As it stands now, a person who develops Type 1 diabetes as a child will have the same medical underwriting as a person 100 lbs overweight who is daignosed with Type 2 diabetes at 50 years of age. Either one will be declined for individual coverage, and both would be covered on a group policy. In the eyes of the insurance industry, they are equal risks, even though the person with Type 1 diabetes did nothing to cause his illness, while the Type 2 diabetes was self-inflicted.
Denying coverage doesn’t seem to be a good answer, as that just exacerbates the cycle of uninsured people waiting to seek care and not having access to treatment. If policies are offered with higher premiums for people with self-inflicted health problems, there needs to be very clear, upfront language explaining the situation, and what the client can do to remedy the problem. For example, a person who smokes and is 60 lbs overweight might be offered a policy - group or individual - with a 40% rate increase. His policy should clearly state exactly what he must do in order to have the rate lowered. He can check in with his doctor every three months for a nicotine test and a weigh-in. For every 10 lbs that he loses, his premium could be lowered by 5%. And if he stops smoking, he could get an additional discount. The premium discounts (or further increases, should the client gain weight instead) should be effective quickly. Most policies currently require that an insured wait a year after losing weight or giving up smoking before a premium adjustment will be made. For most people, that is not enough of an incentive. If we knew that every three months we have the opportunity to lower (or increase!) our health insurance premiums, the sense of immediate gratification would be a strong motivator for a lot of people.
While I understand your view that individuals should take greater responsibility for their health, the solution that you offer of increasing rates for those who are not “healthy” will end up causing increased health insurance premiums and higher profits for the insurance companies. The insurance companies will use this as an excuse to penalize the most vulnerable people with conditions like cancer and multiple sclerosis, which are conditions that no chooses to get. The health insurance companies want anything they can use to raise rates on people.
Although it used to have community rating for small groups, Colorado recently implemented banded rating of small groups. In Colorado, health insurance companies may consider the health status of a small group and give them a discount of up to 25 percent for being “healthy” and increase their premiums 10 percent for being unhealthy. What the insurance companies did with this law was to increase the base premiums rate for everyone and then offer an increase marketed as a “discount” from the increased premiums.
For example, I had BG 1 Blue Cross plan and paid $238 a month. When this law took effect, the standard rate(non–discounted) for the renewal of my health plan was over $300. I was given a renewal rate that included a 13 percent discount of $275 for the exact same plan I had the previous year without any change in age band or zip code: i.e. everything remained the same. Since when is a premium increase of 15 percent a discount! I kept this plan for one more year and then cancelled the coverage as the next year my rates went up to $327, when I was not given the “healthy discount.” At the same time, Anthem, which is now Wellpoint, continued to amass its record profits and payouts to its board members.
The only way one can be healthy for these insurance companies is to never ever go to the doctor. Otherwise, everything is a preexisting condition. Had bronchitis, preexisting condition. Same thing with strep throat. Ear infection, that is preexisting too. I would not be surprised if LIVING would be added to the list of preexisting conditions someday! And if you have more than few things like this, well you will be declined for individual insurance.
Colorado needs to reform its health insurance market and have community rating for both the small and large groups and also for the individual market. Insurance companies should be required to take everyone who applies for their plans. This means there is no more cherry picking used as a method to increase their profits. Medicare Advantage plans are not underwritten, and the companies offering them still manage to make money, so the insurance companies argument is rubbish that they can not make a profit. The only increased premium rate I can support is for smokers whose behavior we know has many detrimental effects.
I agree with a lot of what you said. I too believe that insurance companies should not be able to deny coverage based on pre-existing conditions (which I mentioned in my post). But since there are so many other poor lifestyle choices that people make besides smoking, I would say that they are not the only group that should have increased premiums. Far more people are overweight than are smokers. Being overweight directly causes or exacerbates multiple health conditions (cancer, diabetes, hypertension, back and joint problems… we all know that the list is extensive). Individual health insurance companies can and do screen for obesity in their underwriting - most offer policies with increased rates up to a point, and decline applicants who are extremely obese. But this is not the case for group plans. As you mentioned, the largest health-based rate adjustment a small group can get is 10%. If a person cares so little about his own health and medical future that he is willing to be overweight, it’s hard to expect insurance companies and other insureds to be willing to subsidize his health care costs.
Health insurance companies should be required to cover all children, regardless of medical history. For adults, there should be some factors (weight and tobacco-use are the first two that come to mind, since they encompass a large number of people, are are completely self-determined) that result in increased premiums. For conditions that are not self-inflicted, I would not advise a rate increase. There should only be a rate increase in a situation where the client has the ability to choose to change the situation and then get a rate decrease.
The sad part here is that there really is no discount for the small groups. What the Colorado health insurance companies did was lobby the legislature to pass the banded rating bill for small groups. Anthem reps spoke before the legislature in favor of the bill. They got what they wanted. Then BCBS increased their small group insurance rates by 15 percent from the previous years and told its clients that they were getting a discount. What is even worse, insurance rates went up by as much as 30 percent for those deemed “unhealthy.” According to a health insurance company, a person is not healthy if they have a few claims per year, irrespective of whether it is self inflicted or not. No one wants to get strep throat or bronchitis, but these are all considered preexisting conditions by an insurance company. Have a few of these claims per year, and your insurance rates will be raised.
The insurance companies only care about raising their rates as much as they can in order to maximize their profits, and they will favor and manipulate any legislation that achieves their ends. The most important reforms that should be passed for both the Colorado and national individual and group health insurance market are community rating and guaranteed acceptance. Every person should have the right to purchase health insurance irrespective of their health status and be charged the same rate as every one else. Otherwise, you end up with a system that denies people coverage and forces the costs for the sick onto ERs and the taxpayers.
One option I favor exploring is making a Medicare system for all with the ability to purchase supplemental health insurance to cover the Medicare gaps. There still would be a private system of insurance available for Americans, and the pooling of younger and healthier people into the risk pool would actually lower the overall cost of health care. This system would have to be based on community rating and charge everyone the same rate, irrespective of race, gender, and socioeconomic status. In addition, the Medicare Rx bill passed by Congress would need to be changed to eliminate the doughnut hole. A second option is to require everyone to purchase private individual insurance as is done in Switzerland.
Secondly, Americans are foolish to be paying 400 to 500 percent more for the prescription medicines than other countries in the world. The government should allow for the reimportation of medicines from the major industrialized nations, and it should also negotiate the prices paid for them. The argument that imported medicines are not safe is rubbish, as many of the Rxs we fill will often say made in Canada or the UK. What about importing food or cars, or other items? I never hear that it is unsafe to do so. Negotiated pricing is not a price control, rather it is discounting and lowering costs which is what all businesses do.